5. Piecing retirement togethei. Over your future investing & retired life, assume you earn 7% and that inflation will be 2.5%. Nominal returns are returns before adjusting for inflation. Real returns are returns after adjusting for inflation. While we often hear that nominal returns equal the real return + inflation, this is only an approximation. A more-precise approach is to use the Fisher equation, which holds: 1+nominal = (1+real)x(1-inflation) nominal (1+real)x(1+inflation)-1 real=(1+nominal)H1-inflation)-1 What is the expected real return in X.XX% format? You have $10,000 in your Roth IRA. What is this worth, in today's dollars, in 45 years? You save a separate $5500 per year for the next 45 years. What is this worth? What is your combined portfolio worth? You plan to spend your portfolio over a 20-year retirement. How much can you spend each year in retirement? Use PMT, not +20. Is this in future dollars or today's dollars? a. b. c. d. e. f